62 



THE THEORY AND PRACTICE OF WORKING PLANS 



Years. 



30 

 40 

 SO 

 60 

 70 

 80 

 90 



ICXJ 



no 

 120 



Gross 

 Income 

 per Acre. 



$ 87 

 210 

 402 

 654 

 923 



I2I2 



1474 

 I7IO 

 I919 

 2087 



Expenses per Acre. 



Current 

 /■ni *• N (at $0.90 

 (Planting), j^er Year). 



Initial 



$12 

 12 

 12 



12 

 12 

 12 



$27 

 36 



45 

 54 

 63 

 72 

 81 

 90 



99 

 io3 



Total 

 Expense. 



Net Income per Acre. 



$ 39 

 48 



57 

 66 



75 



84 



93 



102 



in 



120 



Total. 



163 

 354 



1 1 29 

 1382 

 1609 

 1808 

 1967 



Average. 



5 1.60 



4.00 



6.90 



9.80 



12. 10 



14. 10 



15 30 



16.00 



16.40 



16.30 



From this table it is evident that the highest net income 

 occurs at no years and this, accordingly, would be the financial 

 rotation chosen on the basis oi forest rent. 



The doctrine of soil rent considers the soil as a capital and 

 the value of the growing timber as the interest on that capital. 

 Such interest is compounded and is calculated at a predeter- 

 mined rate. The interest so calculated is considered as rent 

 (" soil rent ") and the rotation chosen which yields the highest 

 soil rent per acre. 



In other words it " considers the soil alone as capital, the 

 forest stand representing the accumulated interest on that 

 capital. It is, therefore, based on intermittent returns and 

 hence requires a compound interest calculation: it is a finan- 

 cier's balance as compared with a bookkeeper's balance." * 



A good example of financial rotation based on soil rent is 

 found in European tables. The following figures are taken 

 from Endres' " Valuation " and Schwappach's " Tables of 

 Growth." Assuming an interest rate of 3 per cent compounded, 

 the income value per acre for different decades and different 

 species is as follows: f 



* Letter from Dr. Fernow. 



•t Taken from " Forest Valuation," Roth, Ann Arbor, Michigan, 1916. 



